SEPTEMBER 13 2016 – 10:03AM
James Massola, Fergus Hunter
The Coalition and Labor have agreed to cut back a $1.4 billion baby-bonus payment as part of the deal to pass the $6 billion omnibus savings bill.
The payment, which formed a key element of the power-sharing agreement struck by Malcolm Turnbull and Barnaby Joyce in September 2015, will be wound back as part of a deal to save the $5 a week clean energy payment for welfare recipients.
The trade-off has helped secure Labor support for the omnibus savings bill and, subject to the approval of the parties’ caucus and party room meetings, will clinch the deal.
The baby-bonus style payment would have given eligible families with a youngest child under one year an extra $1000 a year through an increase to their FTB-B payment.
The Parliamentary Budget Office has estimated the cost would have been $1.4 billion over the next 10 years. The cut could anger sections of the Nationals party room, with at least one MP expressing surprise at the proposed trade when contacted by Fairfax Media on Tuesday.
On Tuesday, Finance Minister Mathias Cormann said he was “quietly confident” the omnibus bill would pass and Labor frontbencher Brendan O’Connor said there had been “very significant negotiations” between Senator Cormann and shadow treasurer Chris Bowen.
“I think it’s important that, when we look to rectify what are clearly problems with our budget over the forward estimates and beyond, that we do so with an eye to make sure that people that are most vulnerable in our society are not being punished unduly,” Mr O’Connor told Sky News.
The cut to the clean energy supplement – worth between $4.40 and $7.05 for recipients of Newstart, pensions and family payments – was factored into Labor’s pre-election costings but the Left faction and welfare groups have lobbied vigorously for its survival.
The measure, worth $1.3 billion, has been a flashpoint as the Coalition and Labor have inched towards a deal for days, with equivalent savings set to be found through the compromise proposal.
Trade Minister Steve Ciobo, while taking a swipe at Labor for backing away from support for certain savings measures, said the government had been “pragmatic” and Labor had been “a little constructive”.
“They didn’t agree with everything that they said three months ago but at least they have agreed to some things,” he told Sky News.
The Australian Financial Review reports that the $1 billion funding cut to renewable energy body ARENA has also been watered down as part of discussions.
Current government policies on same-sex marriage, emissions reduction targets and the carbon tax were also features of the Coalition agreement when Mr Turnbull took over from former prime minister Tony Abbott.
Source : Sydney Morninf Herald